11 May 2010

This Budget confirms that Kevin Rudd and Wayne Swan are addicted to spending and
allergic to tough decisions.

This is another big taxing, big spending Labor Budget with no serious reform.

The Budget assumes less smoking with higher tobacco taxes, yet it assumes more investment
with massively higher mining taxes.

Kevin Rudd and Wayne Swan are asking the Australian people to trust them to deliver
a Budget outcome that is based on the most favourable terms of trade in 60 years,
assumes a significant increase in investment in resources and assumes no new additional
Government expenditure between now and 2014.

The Budget’s return to surplus relies upon a great big new tax on Australia’s resources
sector, not tough decisions.

This great big new mining tax is a dagger to the heart of the Australian economy,
putting major projects at risk and sending jobs offshore.

Spending in this Budget will increase by $26 billion over the next three years relative
to last year’s record spending forecast.

The Government will have to borrow over $700 million a week to fund its reckless
and wasteful spending — putting upward pressure on interest rates and the cost of
living for Australian families.

Interest on net government debt will be $4.6 billion in 2010/11.

By 2012/13 the Government will be spending $6.5 billion a year on interest payments.

The peak debt bill of $93.7 billion will be the amount owed by the Australian people
to pay for Kevin Rudd’s spending spree.

The Government has not taken a single tough decision to rein in its reckless and
wasteful spending. The improvement in the Budget’s fiscal position is a direct result
of a growing economy and stronger terms of trade combined with tax hikes on miners
and cigarettes and an attack on private health insurance.

The Budget also exposes the costs of the Government’s waste, mismanagement and policy
failures, including a $1 billion blowout as a result of Kevin Rudd weakening Australia’s
borders and $1 billion being spent to fix Labor’s tragic home insulation mess.

TAX:

The Government’s $9 billion a year mining tax will damage the sector of the Australian
economy which did the most to see us through the Global Financial Crisis. Already
this reckless decision has resulted in BHP casting doubt over the $20 billion expansion
of Olympic Dam, Santos deferring a decision on a $15 billion LNG export-terminal
in Gladstone, Xstrata suspending a $30 million regional exploration programme, and
Origin Energy predicting increases in domestic energy and fuel prices.

Small business across Australia will be deeply concerned by the additional $445
million that Mr Rudd and Mr Swan will be giving to the Australian Taxation Office
for increased compliance.

Offshore asylum seeker management has blown-out by a massive $777 million since
last year’s Budget. This blow-out in offshore management costs has occurred at the
same time as Kevin Rudd has walked away from his commitment to universal offshore
processing. Labor will spend an additional $202 million on accommodation for illegal
arrivals both on Christmas Island and on the Australian mainland in Darwin, Sydney
and Port Augusta.

HOME INSULATION PROGRAMME:

The Budget confirms that Kevin Rudd’s home insulation disaster will cost at least
$1 billion to fix, with thousands of homes across Australia still not inspected
in the aftermath of the scheme’s cancellation. The Home Insulation programme which
has been linked to four deaths and resulted in 240,000 dangerous and dodgy insulation
jobs, 1,000 electrified roofs, and 120 house fires, will now cost the Budget a further
$1 billion. This programme is the most monumental failure of government policy in
living memory.

LABOR SPIN ON SKILLS, EDUCATION AND EMPLOYMENT:

By setting a target for full employment at an unemployment rate of 4.75 per cent
in 2012, the Government is effectively giving up on the employment prospects of
75,000 Australians.

The Government’s promise of a $661 million for skills investment re-badges $601
million of existing spending, including a $456 million cut in the Productivity Places
Programme.

Further delays in the Julia Gillard school halls programme will mean that $500 million
of stimulus funding will not be spent until 2011/12, at least three years after
the Global Financial Crisis.

HEALTH:

The Budget confirms that Kevin Rudd’s health policies will be about more bureaucrats
and not better services. The Government will spend around $500 million to establish
new layers of Commonwealth bureaucracy. In less than a month, Kevin Rudd has broken
his promise of no net increase in health bureaucrats.

Having broken his election promise and built just two of 36 GP super clinics, Kevin
Rudd is now asking the Australian people to trust him to build 23 more. On this
conversion rate, Australians can expect this latest promise from Kevin Rudd to deliver
just 1.4 extra super clinics.

Furthermore, what the Government isn’t telling people is that only 9 of the additional
23 super clinics will be at full scale.

ENVIRONMENT:

Having shelved its response to what Kevin Rudd described as “the greatest moral
challenge of our time”, the Budget demonstrates that the Government does not have
a credible policy on climate change. The Coalition remains the only major party
with a policy that will reduce carbon emissions by five per cent by 2020 while at
the same time delivering good environmental outcomes.

But the Budget confirms that Kevin Rudd’s original great big new tax on everything
— the ETS — will be coming back after the election.

MORE WASTE AND GOVERNMENT ADVERTISING:

In an undisguised election campaign strategy, the Government will spend $126 million
on print, radio and television advertising.

Despite having no climate change policy, the Government will spend $30 million for
another climate change advertising campaign.

The Government will also spend $38.5 million over two years to advertise the outcomes
of the Henry Tax Review even though they only adopted a handful of the Review’s
138 recommendations.

Despite having not even introduced their Paid Parental Leave (PPL) legislation into
the Parliament, for the second Budget year running, the Government has committed
funding for PPL advertising to a new total of $12 million.

The Prime Minister’s daily PR spin on hospitals will continue with a new $29.5 million
advertising campaign to sell their health package even though Western Australia
has not signed on and all new beds won’t even be delivered until 2013-14.

With broadband services under the NBN still years away, the Rudd Government has
committed $16 million over two years, including $7.6 million in the current financial
year, on an NBN advertising campaign while at the same time, cutting $16.4 million
from the previous Coalition Government’s ‘Australian Broadband Guarantee’ programme
which ensured fast and affordable broadband.

It would appear that politically motivated government advertising is more important
to Kevin Rudd than the $21.2 million programme to combat illicit drugs, from which
he has cut $4 million.

DEFENCE

Wayne Swan’s Budget delivers Kevin Rudd’s priorities to Defence — more bureaucrats
and less to the front line, increasing civilian numbers by 1,500 and cutting the
number of uniform personnel by 500. The Budget will also place greater pressure
on recruitment and retention in the ADF with further cuts to the successful defence
gap year programme.

INFRASTRUCTURE:

The Budget does not invest a single additional dollar in Australia’s major road
networks. There is no additional funding for the duplication of the Pacific Highway,
making a farce of Kevin Rudd’s commitment to finish the duplication by 2016 — another
broken promise.